As expected, the US reported a robust start to 2021 with GDP rising at an annualised rate of 6.4% in January-March, (although still below the surveyed 6.7%) up from annualised growth of 4.3% in October-December. Business investment was strong, expanding by 9.9%, with consumer spending jumping 10.7%, not surprising as it coincided with many Americans receiving stimulus checks to help them through the pandemic. However, while about 14 million workers have returned to their jobs, according to the Fed about 8.5 million fewer have jobs compared to the figure before the pandemic. The equates to an unemployment rate of 6%, still well above the 3.5% in February 2020.
These struggles in the job market are one of the major concerns for the Fed. As noted in the FOMC statement on Wednesday, ‘indicators of economic activity and employment have turned up recently, although the sectors most adversely affected by the pandemic remain weak’, adding that the recovery is still ‘uneven and far from complete’.
Plus, the previous leader of the free world has revealed he is ‘100%’ thinking about running for the presidency again in 2024, stating ‘the polls show that everybody wants me to do it and we will, I think, be very successful’. In the telephone interview after Biden’s speech to Congress, Trump also defended his record in office arguing that ‘if I wasn't president, we wouldn't have a vaccine’ and attacked Biden’s position on China, claiming they will ‘take over this country if they don't do something very quickly. He also argued that Biden’s tax increase on both corporations and the wealthy would have a ‘devastating impact’ on the economy and the ongoing Mexican border situation would ‘destroy our country’.